Picture: Reuters/Mike Hutchings
Trade union Solidarity yesterday said it would approach the courts to have embattled national carrier SAA placed under business rescue in a last-ditch attempt to save the cash-burning state-owned entity (SOE).

The union has also set its sights on former directors from struggling state-owned arms manufacturer Denel and power producer Eskom.

Dirk Hermann, chief operating officer of Solidarity, said the union would bring an application of business rescue against SAA and Minister of Public Enterprises Pravin Gordhan.

Hermann said it had planned to bring the application a year ago, but that former SAA chief executive Vuyani Jarana had made several promises to Solidarity to remedy the airline's dire financial position.

“However, these promises have not been met and Jarana has left. We must protect sustainable work at SAA. We saw at Denel what happened to employees if the wait on a business rescue application is too long,” said Hermann.

“This will be the first time that a business rescue application is brought against a state enterprise. This is one of the most drastic actions taxpayers are taking to protect their tax money.

"The work of our members and taxpayers’ money in SAA is too valuable to allow the airline to crash down.”

Jarana in June lashed out at the lack of government support in stabilising the entity.

In a scathing letter of resignation, Jarana said the lack of commitment to fund the national carrier was systematically undermining the airline's turnaround strategy and making it near impossible to break-even by 2021.

SAA has said that it would need R4 billion from the government to survive the current financial year and allow it to renegotiate loan terms with banks. SAA could not be reached for comment on Solidarity's move to have it placed under business rescue.

Hermann said Solidarity would also take legal action against erstwhile directors of Denel and Eskom who presided over alleged corruption at the entities.

“Solidarity will this week still serve urgent court papers on the struggling arms manufacturer Denel to force it to pay the unemployment insurance and tax contributions it had deducted from employees to where it is due,” Hermann said.

“Solidarity also started a process in terms of section 165 of the Companies Act to have mismanagement and corruption perpetrated by former Denel directors investigated with a view to their possible prosecution.”

The trade union said it would, together with business organisation Sakeliga, follow the same process to hold former Eskom directors including Brian Molefe liable.